UPDATE 2-Australia's Sigma, Archer in talks over Symbion assets

(Recasts with Sigma, Archer interviews)

SYDNEY, March 4 (Reuters) - Australia's Sigma Pharmaceuticals Ltd (SIP.AX: Quote, Profile, Research, Stock Buzz) and private equity firm Archer Capital said on Tuesday they are in talks with Primary Health Care Ltd (PRY.AX: Quote, Profile, Research, Stock Buzz) about Symbion Health Ltd SYB.AX assets that Primary may sell.

Primary, which holds 88.35 percent of Symbion after a A$2.7 billion ($2.5 billion) takeover, plans to sell Symbion's consumer and pharmacy business, a highly sought-after asset as Australia's population ages and the use of private health insurance increases.

One banker with direct knowledge of the situation said last week the business had a value of about A$1 billion. Analysts said a sale may not yield as much as Primary may have thought.

"There are a number of people interested. It's a matter of pricing, and since they (Primary) initially entertained the idea of selling those divisions conditions have deteriorated a bit so the price they realise from it may be a bit less," said Brent Mitchell, analyst at Shaw Stockbroking.

Primary said it received expressions of interest from international and domestic parties, but did not give names.

"We are in discussions with them, we have indicated our interest," said Elmo de Alwis, managing director of Sigma Pharmaceuticals.

"It's not anywhere close to finalisation," he said, adding that buying the pharmacy business may be difficult due to competition laws.

Archer Capital, which last year partnered Ironbridge Capital and private hospital operator Healthscope Ltd (HSP.AX: Quote, Profile, Research, Stock Buzz) in a failed bid for Symbion that priced the consumer and pharmacy assets at over A$1 billion, said it was still interested.